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Things you should always buy on sale

Posted by admin on January 22, 2008 in Misc.

Last week, my luggage broke upon arrival. It had survived 3 continents and lots of trips so I am not surprised it finally broke although Air Canada probably didn’t help matters. This meant I had to go shopping for a new one and, to my utter amazement, I found a Swiss Army medium sized luggage regularly priced at $249.99 for $89.99! This got me thinking of items I would only buy on sale and why.

LUGGAGE

I ended up telling a friend who was once a part owner of a luggage manufacture about my find and his response was almost all the luggage in the world is made in China. Given the low cost of manufacturing it, the mark-ups are almost criminal. No one should ever pay full price because the manufacturer and retailer will make money even if they have to sell it for a massive discount to retail price. By the way, for those planning March break trips, look around- luggage is on sale everywhere. Best to pick up some cheap luggage now than wait for March when the price will go up again.
CARS

This item may be a surprise considering it is typically the 2nd most expensive item we will ever buy in life after our house. But here’s the dirty little secret the dealership doesn’t tell you. Almost all manufacturers give dealers incentives to sell cars- the incentives are NOT tied to how much profit the dealer can get for each car but the NUMBER of cars they move in a period of time (the business model of dealerships is not to sell new cars but to service them over its life and sell used cars for massive mark-ups- this is why they totally low-ball you when you sell your car as part of the process of buying a new car. Selling a car and selling printers now have the same business model- they both move units for the primary purpose to make money on after-purchase service.).

All the industry wants is to move inventory off the show-room floor. Profit is secondary in selling new cars (the exception to the rule are luxury cars where demand out-strips supply) Don’t believe the salesperson when they say the dealer needs to make money on selling a car. Tell them you know about the dealer incentive to move units and they make money no matter how much or little they sell the car for (Million Dollar Journey has a great post on negotiating the best price for a car).

TOILET PAPER/NAPKINS

Ever notice that these are always on sale? Also notice that they are always advertised on sale? These are nothing more than loss leaders to get you into the store so you can buy pharmaceuticals, cosmetics and other high-profit goods. You would be a fool to buy toilet paper and napkins at full price.

TOWELS

Same reason as toilet paper. Department stores have white sales so you can buy furniture along with your towels.

BEST- SELLER BOOKS

There’s a huge imbalance between publishers and retails now. The retailers are now huge chains (Borders, Barnes & Noble and Chapters) who can force the publishers to do whatever they want- including putting best-sellers on sale to move product. Retailers can also return books with impunity to the publisher. Rather than accept these, it allows the books to go on sale or moves them to discount book-stores.

Of course, there’s the effect of the internet on book prices. Amazon discounts most books because it has no bricks and mortar costs to pay for since it has no stores so it can force the industry into price wars. Take advantage of it.

What do you never buy for full price and why?